Applied Industrial Technologies, Inc. AIT reported better-than-expected results for third-quarter fiscal 2018 (ended March 2018). Earnings and Revenues
Quarterly adjusted earnings came in at $1.05 per share, surpassing the Zacks Consensus Estimate of 85 cents. The bottom line also came in higher than the year-ago tally of 75 cents per share.
Net sales during the quarter came in at nearly $828 million, beating the Zacks Consensus Estimate of $715 million. In addition, the top line came in higher than the prior-year figure of $679.3 million. The upswing stemmed from elevated acquisition-related volume and favorable foreign currency-translation impact.
The company's quarterly organic sales improved 6.7% year over year. Segmental Details
Revenues of the Service Center Based Distribution segment came in at $601 million, up 4.8% year over year. Also, aggregate sales of the Fluid Power Businesses segment were $227 million, up 114.6% year over year. Costs and Margins
Cost of sales in the reported quarter was $588.1 million, up 20.4% year over year. Gross profit margin came in at 28.9%, expanding 80 basis points (bps) year over year.
Selling, distribution and administrative expenses (including depreciation) totaled $183.1 million compared to $145.1 million incurred in the year-earlier period. Operating margin in the fiscal third quarter came in at 6.8%, higher by 10 bps year over year. Balance Sheet & Cash Flow
Exiting the reported quarter, Applied Industrial had cash and cash equivalents of $43.5 million compared with $105.1 million recorded at the end of fiscal 2017. The company's long-term debt was $1,017.3 million, higher than $686.8 million recorded as of Jun 30, 2017.
In the first nine months of the fiscal, the company generated $47.9 million cash from operating activities compared to $78.5 million cash generated in the year-ago quarter. The company purchased property worth $17.9 million, higher than $11.8 million procured in the comparable period last year. Outlook
Applied Industrial believes its revenues and profitability in the upcoming quarters will improve on the back of tailwinds prevailing in the industrial end-markets. This Zacks Rank #3 (Hold) company also raised its earnings per share guidance for fiscal 2018 (ending June 2018) from the $3.40-$3.50 per share range to the $3.51-$3.61 per share range.
Moreover, Applied Industrial anticipates to bolster its sales by 17.5-18.5%, higher than the prior guidance of 6-7%. Stocks to Consider
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Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Applied Industrial Technologies, Inc. (AIT): Free Stock Analysis Report Kawasaki Heavy Industries Ltd. (KWHIY): Free Stock Analysis Report IDEX Corporation (IEX): Free Stock Analysis Report Tennant Company (TNC): Free Stock Analysis Report To read this article on Zacks.com click here.